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• Meta to use Broadcom’s 5nm and 3nm chips for its metaverse
• Broadcom has been developing custom chips for Google’s machine learning
Facebook’s parent company Meta Platforms Inc (NASDAQ: FB), could become Broadcom Inc’s (NASDAQ: AVGO) next billion-dollar, as the social media company may use the chipmaker’s custom semiconductors to build its metaverse hardware, J.P. Morgan analysts said on Tuesday.
The financial institution said the chipmaker would generate $2 billion to $2.5 billion in revenue from ASIC (application-specific integrated circuit) chips this year, helped by its deals with Meta and partnerships with Alphabet (NASDAQ: GOOGL) and Microsoft (NASDAQ: MSFT).
ASICs are customized to perform a particular hyper-specific task rather than a general-purpose use.
“We believe these wins are primarily at 5 nanometre and 3 nanometre and will be used to power Meta’s metaverse hardware architecture that it will deploy over the next few years,” J.P. Morgan analyst Harlan Sur said, adding that the social media giant would emerge as Broadcom’s next $1 billion-a-year ASIC customer over the next three to four years.
Meta is developing a range of hardware for the metaverse, including smart glasses and virtual reality headsets. The social media giant has even opened its first physical store where shoppers can try out AR and VR devices and other gadgets.
“Near-term ASIC program pipeline is strong as we believe Broadcom will be ramping Meta/Facebook and Microsoft ASICs this year,” Sur added.
Picture Credit: Simply Wall St
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